Reply to Wes Moore Wants to Destroy Your Neighborhood

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]This sounds like a good idea to me. They’re not going to destroy your suburban neighborhood.[/quote]

I fully intend to help destroy my suburban neighborhood, and make a nice pile of cash doing it.

[b]We’re on a big corner lot in Chevy Chase View, and if this goes through, we’ll form a developer LLC, knock our current SFH down, and replace it 5-7 townhomes. At the current market, we’d clear about $1.6M after construction and sales. 
[/b]
I hate this neighborhood and I hate my neighbors, and nothing would delight me more than to stick a bunch of low-end townhouses right here on the corner for everyone to look at. [/quote]

I'm not understanding the math here.  Wouldn't you clear more than that just selling your house to a developer?  They still have to bid against people that may want to keep it as a SFH, so it's not like they can only bid your land value.  They can bid more because they intend to do just what you mention.

If you aren't in the business, it sounds crazy to me that you will assume 100% of the risk and expense (not to mention, where are you living during the 2 years to do all this and how much does that cost?), just to clear $1.6MM vs. what would you clear just selling to a developer and moving on.[/quote]

Why would we sell to a developer for $1.5ishM when that developer will just turn around and net $1.6M after demo and construction expenses for some builder-grade townhouses?

Makes a lot more sense for us to just keep the property, form our developer LLC, hire a contractor, spend $100k raising our home and doing site prep, then another $7-800k building a half dozen townhouses, and selling each for $500k.

After paying off the remaining balance on our loan, and permitting fees and construction expenses, we’re still up $1.6(or  more)M.

So to be clear: you’re asking “why we’d rather walk away with $1.6M instead of $600k?”

I don’t really understand why you’d ask that question.

I don’t understand you….. at all. [/quote]

Because unless you are in the business of building homes, I guarantee your numbers are off by likely a wide margin.

Just your $100k estimate for razing your home and doing prep work is probably off by like $150k in the DMV.  How are you possibly building 6 townhomes for $800k?  How big are these townhomes?

If you are directly in the business, then maybe you do know what you are talking about.

Why are you only getting $600K if you sell your house to a developer for $1.5MM? [/quote]

Yes, I’m tangentially “in the business”, so my figures are nailed down. [/quote]

So, you are a developer yourself.  It's just you will reap the rewards vs. a 3rd party developer.[/quote]

Newly built townhomes in Chevy Chase View would go for $1.2M easy. PP would way more than what they think they would. These townhomes fetched almost $1.5M each and they are under The Beltway.

https://www.redfin.com/MD/Chevy-Chase/3729-Glenmoor-Reserve-Ln-20815/home/167686977[/quote]

They would cost way more than $135,000 each to build...unless they are like 800 sq ft townhomes.  None of the math makes much sense...building townhomes for $135,000 and selling them for $500,000.[/quote]

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